Let’s have an ‘evidence-based’ Free Market

For market economies, and the Western model of democracy with which they have been associated, the existential challenge for the foreseeable future will be global warming. Other threats like terrorism may well be damaging, but no other conceivable threat or combination of threats can possibly destroy our entire system. As the recent British official commission chaired by Sir Nicholas Stern correctly stated, climate change “is the greatest and widest-ranging market failure ever seen.”

The question now facing us is whether global capitalism and Western democracy can follow the Stern report’s recommendations, and make the limited economic adjustments necessary to keep global warming within bounds that will allow us to preserve our system in a recognizable form; or whether our system is so dependent on unlimited consumption that it is by its nature incapable of demanding even small sacrifices from its present elites and populations.

If the latter proves the case, and the world suffers radically destructive climate change, then we must recognize that everything that the West now stands for will be rejected by future generations. The entire democratic capitalist system will be seen to have failed utterly as a model for humanity and as a custodian of essential human interests.

Underlying Western free-market democracy, and its American form in particular, is the belief that this system is of permanent value to mankind: a “New Order of the Ages,” as the motto on the U.S. Great Seal has it. It is not supposed to serve only the short- term and selfish interests of existing Western populations. If our system is indeed no more than that, then it will pass from history even more utterly than Confucian China — and will deserve to do so.

Having read the occasional post from Jennifer Marohasy‘s weblog of politics & the environment, where there was some discussion about polar bear populations, I was curious to learn more about her.

Marohasy works for the Institute for Public Affairs – self-proclaimed leading Australian Free Market Think Tank – which consults, spruiks, spins to governments and the media on a wide range of political/economic/educational/environmental issues with a pretty hardline right-wing free-market agenda.

While skimming back over a number of topics in her weblog it seems to me that Marohasy’s approach, as an acredited environmentalist, is to run interference on enviromental issues in the guise of advocating ‘evidence based’ science as being essential to any policy movement from ‘steady as she goes’. (Indeed, the IPA is offering “4 PhD scholarships to undertake evidence-based research into environmental issues with the aim of providing improved information and frameworks for prioritising environmental need, quantifying the costs and benefits of conservation initiatives, developing agricultural policies and appropriate legal frameworks” to aid the cause.)

The call for evidence-based science appears fair enough, but given the IPA’s stance on other issues, I suspect the intent is to underplay environmental issues (global warming may be good for polar bears?), or at least buy time to find free-market solutions (as opposed to government regulation).

Trouble is, if Sir Nicholas Stern’s contention that climate change “is the greatest and widest-ranging market failure ever seen” is true, I’d be very skeptical of finding a free market solution to a problem largely created and driven by a free market global economy.

Perhaps a think tank somewhere could come up with an ‘evidence-based’ approach to free market economic ideology? Let’s factor in environmental costs, the exploitation of third-world natural resources and cheap labour, the cost of military intervention in third world politics to protect access to resources, social and family costs, etc, etc and evaluate whether this New Age Economic Order is actually working, let alone sustainable, for the planet and its people, not just those accumulating riches. Given its dependence on unlimited growth in consumption, my understanding of ecology suggests that the free market economic mode, if not fatally flawed, at the very least, has significant shortcomings and failings for the planet as a whole.

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7 Responses

It’s actually worse than that in my view. The Stern Report itself is hopelessly compromised by his need, as a government economist working in effect for Gordon Brown, to be acceptible to the investors in the City of London by keeping his recommendations well inside the neo-liberal consensus.

The test of this is the way Stern sets his emissions target. He quite swiftly dismisses the 450ppm CO2 equivalent target that most of the scientists would argue for as too difficult, essentially because it would retard economic growth too much. So he opts instead for a target of 550ppm CO2e, because he thinks he can make a case for good investment options around that target. 550ppm means a russian roulette players chance of avoiding some very serious problems like e.g. melting ice sheets and carries us into the zone where runaway climate change becomes a possibility.

J MoreHorseShitty wouldn’t recognise an unbiased evidence-based approach if it bit her, as it should. That covertly industry funded spokeswomen cherry picks her data and has the gall to bang on about standards and compare herself to dead philosophers and the like who can’t object. She claims to have no interest in knowing who funds her research and denies being influenced by the clear conflict of interest in her advising the govt on the Murray River. Read her IPA review articles (eg the one on the polar bears) to see how scant and selective she is with the evidence! Unbelievable guff, I’m gobsmacked that people will swallow it. From challenging her I’ve started to get a picture that she promotes evidence-based caution in doing original research but come to quoting secondary sources, feels free to choose and (mis)interpret with a free license to defend her manufactured lines as she feels fit.

Note that on her blog she rarely if ever does or provides research or links to back her claims. If people make personal observations that fit her views she elevates them to the status of ‘evidence’ and even writes pieces on them under the guise of her IPA policy role. I wonder if the IPA & their sponsors realise the low and lazy standards of her work that they pay for.

Look around at everything that makes your life more comfortable, informed and rewarded and thank the free market. Perhaps you’d like to show us a controlled economy that consistently raises its population’s standard of living. North Korea, perhaps? Cuba? You can nut about that at the back of the cave over a bowl of boiled grass with the socialists, enviro-nuts and fellow-travelling fascists.

Indeed I may well thank the free-market, but I suggest that the free-market creates problems of its own and exacerbates others.

I don’t see it as free-market OR a controlled economy. These positions are part of the one continuum of economic development. And standing resolutely shouting “Hooray for our side, the others are dangerous loonies” does not foster understanding or progress. We should use our collective wits and ethics to ameliorate the excesses and unintended consequences of the free-market.

Nor do I have a lot of faith in the notion that any short-comings in free-market practice are only caused by regulatory policies interfering with its proper manifestation. I suspect some issues cannot be solved efficiently by free-market forces alone.